A privately funded rocket suffered a launch failure Saturday night, the third launch failure in as many attempts for an Internet entrepreneur who is hoping to develop private space delivery and transportation.

The failure occurred about two minutes after the launch of the two-stage Falcon 1 rocket, which was manufactured by Space Exploration Technologies, also known as SpaceX. A failure prevented the two stages from separating after the launch from a central Pacific atoll, SpaceX CEO Elon Musk said in a company blog. The rocket was carrying three satellites for NASA and the Department of Defense. Musk said an investigation into the cause of the failure is under way, but he called the launch itself "picture perfect."

Musk, who co-founded PayPal and sold it to eBay for $1.5 billion in 2002, co-founded SpaceX that same year and secured a contract with NASA to replace the space shuttle after 2010 in servicing the International Space Station.

The failure marks the third time in a little more than two years that SpaceX fell short of orbiting Earth post launch. In March 2006, a fuel line leak caused the first rocket to fail about a minute after launch. The second rocket, which was launched in March 2007, made it to space but was lost about five minutes after the launch when it started to spin.

Musk said his goal with SpaceX is to reduce the cost and improve the reliability of space transportation. SpaceX will launch payloads like satellites into space at a third of the cost of its domestic competition and at half of the cost of its international competition, according to Musk.